George Pataki, the ex-governor of New York State, has been identified as a “leading candidate” for chairman of the Puerto Rico Financial Control Board.
He is portrayed as an affable and moderate Republican, with an easygoing personality, who will bring a “fair and balanced” approach to governing Puerto Rico. Nothing could be further from the truth.
I know a great deal about George Pataki’s style of governance, because I was a New York State Assemblyman during the first four years of his administration.
I saw, first-hand, how he operates.
THE MESSAGE OF NECESSITY
Created by New York in 1894 for dealing with war, plague, catastrophe, and other emergencies, the “Governor’s Message of Necessity” (MON) is currently used to ram bills through the New York state legislature – particularly those that require public funds.
When the governor of New York attaches a so-called MON to one of his bills, the constitutional 72-hour reading period is suspended. Legislators have only one or two hours to vote for the bill – with no amendment, no debate, and worst of all, no time to read it.
Year after year, Pataki would wait until the last two days of the legislative session. Then he’d send a dozen bills…some longer than 200 pages, most with MONs attached, and all with appropriations buried deep inside the bill.
Only the lobbyists knew about these funding appropriations – because the lobbyists had structured the bills, and the legislators had no time to read them.
During the Pataki years, 25 percent of all New York State law was created under these MONs. With no public input or legislative review, the lobbyists turned these “messages of necessity” into a free lunch, with taxpayers paying the price.
If you’ve ever wondered why New York State was declared the “most dysfunctional state legislature in the entire US” in 2004, 2006, and 2008, Pataki and his MON will explain it for you.
If you’ve pondered how New York has the third-lowest bond rating in the nation, and the second-highest debt per capita, the answer begins with Pataki’s use of the MON.
Over 12 years, Pataki increased the general fund spending of New York by a whopping 67 percent.
For 12 years, Pataki used the MON to facilitate $22 billion in hidden “back-door borrowing.”
For 12 years, Pataki allowed lobbyists to march through his office, write their own legislation, and stick the taxpayers of New York with tens of billions in high-interest municipal bond debt.
This is exactly the fiscal practice that exploded the public debt of Puerto Rico…and now Pataki is going to chair the Financial Control Board?
As governor, Pataki vetoed $500 million for school construction and $77 million for teacher salaries. He cut $17.3 million from the SUNY budget, $8.6 million from CUNY, and $13.5 million for school textbooks. Altogether, the Pataki education cuts totaled over $615 million.
From 1998 to 2008, state funding for SUNY and CUNY schools fell 17.5 percent. Yet in six years alone, from 1991 to 1997, tuition for SUNY and CUNY students tripled, and Pataki supported every single tuition hike.
In New York City, the funding cuts were so severe that parents sued the State of New York to stop the State from cheating NYC children of over $4 billion per year, every year, in public school spending.
The parents won the federal lawsuit – but Gov. Pataki simply ignored the court, and the court’s order.
This was Pataki’s education legacy: by the time he finally left office, 50% of NYC public schoolchildren were no longer graduating from high school, and over one million New Yorkers were reading at a 4th grade level.
While closing schools and laying off teachers, Pataki found enormous amounts of money for more jails in New York.
During Pataki’s tenure, the state inmate population tripled to over 110,000, and nearly 200,000 more were on parole. Every year, Pataki spent over $5 billion on prisons, about $15 million per day…and each NYC inmate cost $58,300 per year.
Pataki also committed over $4 billion to building more prisons…and every new prison was built in an upstate GOP district.
Thanks to Pataki, almost half of New York’s prisons are in the state senate districts of four Republicans – in decaying old towns, all floundering in the wake of agricultural and industrial collapse. The prisons graced each town with employment, no-bid contracts, and political patronage.
In this manner, the prisons became a de facto “economic development project” for each of those districts, with majority white populations profiting from prisons that were 92% black and Latino.
The Pataki prison system was characterized as an “underground railroad in reverse” in John Flateau’s The Prison Industrial Complex: Crime and Justice in New York.
THE CHADBOURNE & PARKE CONNECTION
Currently, just like ex-governor Luis Fortuño in his D.C. law firm of Steptoe & Johnson, ex-governor Pataki is comfortably ensconced in the law firm of Chadbourne & Parke.
For decades, Chadbourne & Parke was the general counsel for United Brands.
What is United Brands?
As of 1970, it was the “new” corporate name for the United Fruit Company.
The name was new, but the business model was not. In 1975, United Brands was caught bribing Honduran President Oswaldo López Arellano with $1.25 million, and promising him another $1.25 million, for a reduction of “certain export taxes.”
Two years later, in 1977, Chadbourne & Parke was still representing them.
In 1984, United Brands became Chiquita Brands International…another new name, with the same old business model. In March 2007, Chiquita Brands pleaded guilty to aiding and abetting a terrorist organization, when it admitted to the payment of more than $1.7 million to the United Self-Defense Forces of Colombia, a group on the US list of terrorist organizations.
Currently, Chadbourne & Parke prides itself on the depth of its Latin American Practice. It is “one of the leading banking and finance firms in Brazil,” it has an extensive Mexico practice, and it recently created a US-Cuba Task Force to “facilitate US investment in Cuba.”
They negotiated recent deals with Petrobras Brazil and Petrobras Chile.
Their “Latin America experience” shows corporate and securities transactions totaling more than $50 billion over the past ten years.
Clearly, Chadbourne is bullish on “developing markets” throughout Latin America. When the economic hit men move in, Chadbourne wants to be right behind them…negotiating the bond deals, schmoozing the bureaucrats, filing the SEC documents, grabbing the legal fees.
As chairman of the Financial Control Board, George Pataki will be perfectly positioned to steer millions in legal fees to Chadbourne & Parke…with a fat commission for Pataki.
Pataki could also inform the Chadbourne corporate client base, of sweet deals in Puerto Rico.
For political cover, Pataki and Fortuño could swap deals between their two law firms, and build a mutual veneer of “non-involvement” in business matters before the Control Board.
THE BANALITY OF EVIL
Despite being mayor of Peekskill for 3 years, a state legislator for 10, and governor of New York for 12, Pataki never mastered the use of a Teleprompter.
His oratory was oafish. His State of the State speeches were best appreciated after two or three drinks…and in Albany, they often were.
Not much of a reader, not much of a numbers man, he bumbled through 25 years of state government with an “aw shucks” smile and an ignorance of legislative and budgetary detail, that endeared him to every lobbyist in Albany.
In the 2012 presidential cycle, he bored the voters of Iowa so badly (a difficult thing to do), that he quit the race a year before the actual primaries, in 2011.
In the 2016 presidential race, he was immediately relegated to the second-tier debates…then barred from the debates entirely, because his national poll numbers were less than one percent.
And now this amiable has-been, is being floated as the potential emperor of Puerto Rico.
After 118 years of solitude, Puerto Rico might soon suffer the indignity of Moncho Reily, all over again. Except this one will have sweeping financial, legislative and prosecutorial powers, that the original Moncho Reily could only dream of.
This combination of concentrated power and personal incompetence, may lead to disaster.
Pataki left New York State in the exact same fiscal shambles, that is now gripping Puerto Rico.
He doesn’t have a clue about Borinquen.
Like a bull in a china shop, or an out-of-control elephant, Pataki will mindlessly trample the entire Puerto Rican economy, excreting “public-private partnerships” that will drain the island’s lifeblood.
He will then be hailed by the US corporate media, for “reforming” the insular economy.
George Pataki is a shining embodiment of Hannah Arendt’s banality of evil: an easygoing hack who will allow lobbyists and hedge funds to walk all over him, so long as they retain Chadbourne & Parke while doing it.
He is the perfect neo-liberal foil…whose brand of bone-deep stupidity, though masked by pomp and circumstance, pose a severe threat to everyone in Puerto Rico.
Well, maybe not everyone. Just the bottom 99%.